Tag: Trade War

Trump Supporters are exhilarated about their US created global trade wars

Trump supporters approve of the US presidents actions, words and attitude at historic levels. 90% approve of everything Trump does or says, not everyone agrees. Yet, many wonder whether the GOP actually is following a plan:

European’s, especially Merkel, are frightened by the changes imposed on the EU. The situation depends on the individual global companies business strategies. Many European and Asian companies are baffled by Trump’s strategy. For many decades they have listened to many US presidents and their “Partners in Leadership” promises and in the spirit of collaboration have created hundreds and thousands of jobs for Americans in the US.

Das Handelblatt’s, Lukas Bay, reports: “The US president has threatened European automakers such as VW, BMW and Daimler with a levy. He’s forgetting that the Germans have huge plants in the US. At the time, he warned that BMW and other carmakers could face a 35 percent import duty for cars not built in the United States. He targeted BMW because it is building a new plant in Mexico. Trump doesn’t seem to realize that the BMW plan in Mexico is there to meet rising demands for cars in Latin America.” BMW actually exports cars made in the US by American workers. Source: Das Handelsblatt

Der Spiegel reports: “Executives at Siemens, the global engineering giant, are still relatively relaxed at company headquarters in Munich. Siemens operates its own plants in the U.S. for products with high steel or aluminum content like trains, gas turbines and ultrasound equipment. In theory, at least, its subsidiaries could buy raw materials or semi-finished products locally to circumvent the punitive tariffs. But that does not apply to special alloys that are not produced in the U.S. They would have to be imported from Germany and would be slapped with the additional tariffs. The biggest concern is not the impact the trade tariff’s have on the US – German trade – it is only 4% for many companies so they can withstand that comfortably.

The bigger issue that companies and countries are grappling with is cheap steel that is now diverted from Russia, India and Turkey. Since these companies were not given a temporary exemption they have dumped their inferior products in the EU for super low prices. The EU is more worried about the effect these inferior steel will have on the EU brand around the globe as cheap inferior products are making it on the market. It will not affect the US either in trade nor in taxes.

In Germany for instance 95% of all wealth is created by small and midsize firms. This is the reason why Germany is thriving and able to withstand economic upheaval. Germany has a very strong middle class that has been growing jobs. In the US the Middle Class has been eroded by corporate welfare laws that favor large global conglomerates.